Ilika plc engages in the design, development, and production of solid-state batteries under the Stereax name primarily in the United Kingdom, Asia, rest of Europe, and North America. It offers batteries for a range of applications in the industrial Internet of Things, medical, transportation, electric vehicles, and cordless consumer electronics/ smart cities. The company was founded in 2004 and is headquartered in Romsey, the United Kingdom.

Ilika plc

Industrials

The company does not pay dividends at all, or it pays them sporadically. There have only been a few years with dividend payments in the past ten years. 

ILIKF reported revenue of GBP 1mn in the last 12 months, up 90% from FY23. At the same time, the dynamics of cash flow, as measured by free cash flow (FCF), were drastically different. EPS fell 0% from FY23 to GBP -0.04. Market expects EPS to reach GBP -0.04 in FY24.

The stock's performance has been mixed in the past six months, with growth following a decline. There is no clear price trend compared to its global peers from the same sector and industry (as shown above). The stock has outperformed this peer group by 106ppts over past six months and grown 18ppts faster in the past month. This is largely true for peers from the same country and sector. With respect to the stock's valuation against its peers, its overall price performance is 'fair'.

The ratio of return on invested capital (RoIC) to the weighted average cost of capital (WACC) has been -2.0 in the past several years. This ratio implies a fragile shareholder value creation. 

The institutional, legal, and compliance risks associated with the company's country are minimal. In combination with stringent business standards, shareholder rights are very highly protected.

ILIKF has very poor trading liquidity. It will take considerable time for the average private investor to sell a common position under normal market conditions. Liquidity is usually stable and becomes extremely unfavourable on the days with the lowest activity. The trading volume mostly stays the same even under highly turbulent market conditions. The stock has a tiny market capitalisation, which usually makes its trading liquidity erratic and unpredictable. 

No other major risks have been identified.

The risk of default is very high. Among the negative credit factors, we point to weak positions in its industry, slow historical revenue growth, bleak profitability, negligible return on capital, inadequate interest coverage, and poor cash flow generation.

In highly turbulent market conditions, ILIKF is exceptionally volatile. In other words, the stock will be among the worst-performers in times of extreme market volatility or shocking company news. Standalone, the worst-day losses (less than 1% of the time) will likely be critical. 

In normal market circumstances, ILIKF is exceptionally volatile. Put differently, without outstanding market volatility or shocking company news, the stock's price will change quite unpredictably. The stock's losses on its worst days (less than 1-5% of the time) will range from critical to immense. 

From both historical and forecast perspectives, the stock is considerably overpriced compared to similar stocks. 

Ilika plc

$ 0.51

2

Ilika plc

$ 0.51

2

Risk factor

Profitability factor

Risk / Profitability

Risk factor

Profitability factor

$ 0.51

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